New York has some of the world’s top universities and attracts highly credentialed scientists from around the globe, so how can we have a shortage of workers with STEM skills? The answer has to do with the fact that New York is a large and diverse state, with tremendous variation in demographics and economic conditions from region to region.

In the Public Policy’s 2017 skills gap survey, we defined STEM according to the Standard Occupation Classification Policy Committee scheme. Under our definition, STEM covers a wide array of occupations—from manufacturing technicians to nurses, from civil engineers to computer programmers—and at credential levels from associate’s degree to Ph.D. In some of these fields, there are regional shortages, while in others, employers have no difficulty finding talented employees. Thus, rather than statewide, across-the-board shortages, this study and others have found local or regional skills mismatches, varying by industry.

In our survey, executives reported the highest difficulty filling positions in Western New York, where one-third of survey respondents reported high difficulty and 62% reported moderate or high difficulty filling positions. Similarly, in the Southern Tier, one-third of respondents reported high difficulty, and 45% reported moderate or high difficulty filling positions. In the Capital Region, one-quarter of respondents reported high difficulty and 63% reported moderate or high difficulty filling positions. In the Finger Lakes, 64% of survey respondents reported moderate or high difficulty filling positions, but only one of those reported high difficulty.

The economic effects of the skills gap take several forms, starting with a reduction in employers’ ability to meet the needs of their customers. “We’re finding it hurts the manufacturers because you’re having machines sit idle,” says Bruce Hamm, Director of Business Engagement at the Manufacturers Association of Central New York. “People lose out on orders because they can’t fill them.”

The fact that skills mismatches are localized does not make them less consequential to New York’s economy. An employer struggling to find skilled workers upstate is unlikely to take comfort in the fact that the very same skills are in oversupply in Long Island. Some workers may be willing to uproot to a distant town they’ve never heard of, but it is equally likely that the employer may go out of business or relocate to another state.

In addition to the impact on New York’s existing employers, the availability of a skilled workforce—or lack thereof—has an effect on economic development efforts. “The first thing that companies do when they’re looking to relocate into an area is to look at what the workforce looks like,” says Hamm. “So if New York’s economic developers are looking for companies to come here, we’ve got to demonstrate that we’ve got the workforce. The skills shortage is all over the country. If you can show you’re actually doing something about it, you’re on the good side of the equation.”

New York created close to 100,000 jobs between December 2015 and December 2016. Yet in many regions of the state the population is not growing. (Population increases downstate and in the Capital Region/Hudson Valley, driven by the birth rate and immigration from foreign countries, are offset by upstate outmigration to other states.) This means that employers who want to fill jobs are increasingly forced to select from the existing pool of potential workers. Nationally, the economy has added 11.6 million jobs since the recession bottomed out in 2010, and 99% of those have gone to workers with at least some college education, according to Anthony P. Carnevale and his team at Georgetown University’s Center on Education and the Workforce. Since the recession hit in 2008, they found, there has been a net loss of 5.5 million jobs that required only a high school diploma.

STEM jobs, in particular, are growing at a faster rate than overall employment and require higher skill levels than do many jobs in retail, food service, and hospitality. Consistent with these trends, executives responding to a 2017 Public Policy Institute survey reported that health occupations and skilled production—both of which are STEM fields—are the categories in which they had the largest numbers of job openings in 2016.

As technology evolves, the skills that STEM employers seek are changing faster than our education system has traditionally been able to adapt to meet them. Thus, the skills gap—a divide between the skills employers need and the skills workers possess—is a threat to New York’s competitiveness in the global economy. Caught in the crunch, New York’s employers have taken the lead in investing in and partnering with education and training providers, in order to maximize the potential of workers in their own communities.

What kinds of institutions and programs are employers partnering with?

What do these partnerships look like in practice?

What are their main goals, and how successful are they?

What policy changes could make them even more successful?

Over the coming weeks, this blog series will describe how well-designed collaborative programs can take underperforming students, who might otherwise have dropped out of high school or required remedial classes in college, and get them back on track. Working together, employers and educators are providing these students with the academic, technical, and professional skills and credentials they need to succeed in a STEM career.

Such programs are being replicated across New York State, but the funding needed to sustain them is not guaranteed, and they still serve only a fraction of the students and communities who could benefit. If New York wants to maximize the economic future of its students and its businesses, creating model programs is not enough. Policymakers, education leaders, and employers need to take the next step, using a data-driven approach to rethink and retool our entire education system with the goal of ensuring college- and career-readiness for all P-12 students, and completion of a degree or employer-recognized credential for all postsecondary students. If it is willing to commit the necessary resources, New York has the opportunity to solidify its position as a leader—not just in designing and creating, but in scaling and sustaining innovative models that bring educators and employers together to meet the workforce needs of the 21st century.

The priorities of our K-12 education system are not always in sync with economic opportunities—an insight repeatedly noted by the employers and STEM experts who participated in the Public Policy Institute’s 2017 research on the skills gap. Not only do our schools sometimes funnel students toward courses and credentials that lack value outside the academy, the education establishment may also (albeit unintentionally) perpetuate the stigma associated with career-oriented courses and programs.

Whereas business people are accustomed to designing products and processes to satisfy the needs and wants of particular customers, and success is measured by the bottom line, our education system is more complex. It must prepare students not only for academic success, but also to be ready to join the workforce, shoulder the responsibilities of citizenship, and live well-adjusted, fulfilling lives as members of their community. To help ensure that they are preparing students in all of these areas, schools have to look not only at whether students are getting through their classes. They also need to look beyond themselves to see how their alumni are doing when they get to the next level, whether it be higher education or the workforce.

Bruce Hamm, Director of Business Engagement at the Manufacturers Association of Central New York, underlines this point: “The metric for high school success is graduation. They’re not asking are they going to be successful in college, they’re saying, ‘Let’s get them out of high school.’” The same problem applies to post-secondary institutions. “The colleges are asking, ‘Is our enrollment good enough?” and they’re getting some pressure now to graduate people, but it’s not enough,” says Hamm. “The question colleges are not asking is, ‘Are these kids getting jobs?’” In other words, what gets measured gets done. Currently, Hamm says, “you have a set of metrics that almost ensure that all of this is in silos. You need people that are able to cross boundaries and start meaningful conversations—people in education that understand industry, educators that are willing to talk to each other as well as to the business community.”

Recent changes in federal law provide the business community with an unprecedented opportunity to ensure that schools are held accountable based on outcomes that are important to student success in today’s economy. The bipartisan federal law that replaces No Child Left Behind, known as the Every Student Succeeds Act (ESSA), gives states flexibility to craft their own systems to hold schools accountable for student outcomes —most importantly, whether students are graduating college- and career-ready. Right now, state leaders are making big decisions about what it means to be a successful school, what rate of academic progress is acceptable, and what to do when schools are not meeting our expectations. By itself, a well-designed school accountability system cannot solve New York’s skills gap, but these decisions have significant implications for our employers, workforce, and economic competitiveness.

So how can employers and the business community make our voices heard? With support from the U.S. Chamber of Commerce Foundation, The Public Policy Institute and The Business Council of New York State have convened an unprecedented coalition of civil rights, education, parent, and business organizations to advocate for a strong accountability system that promotes college and career readiness for all New York students.